This paper models the economic and hydrological impacts of upstream water diversion on downstream floodplain activities. The model is illustrated and applied to the example of the Hadejia‐Jama'are River Basin, northern Nigeria. Full implementation of all the upstream dams and large‐scale irrigation schemes in the river basin would produce losses of US$20.2–20.9 million in present value terms in terms of flooplain agriculture, forestry, and fishing. The associated annual losses from declining groundwater levels in surrounding areas would be around $1.2 million for tube well irrigation and $4.76 million for domestic water consumption. The introduction of a regulated flooding regime for upstream dams would probably protect the groundwater recharge function of the downstream floodplain and reduce substantially the losses to agriculture, forestry, and fishing to around $15.4–16.5 million.
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Edward B. Barbier (2003) studied this question.
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